Fannie and Freddie Reform Is Necessary, but Not at Expense of Private-Sector Investment

Private investors and the government don’t always make easy bedfellows and nothing exemplifies this more than the case of Fannie Mae and Freddie Mac. After verging on collapse in 2008, the government-backed mortgage groups are now turning significant profits, but investors are not happy. Since their inception, the structure of Fannie and Freddie has been […]

Does the Keystone XL Pipeline Still Matter?

Last month it seemed the Keystone XL pipeline was nearing approval, but as with most things surrounding the project, things weren’t as they seemed. A US state department report reviewed the Alberta, Canada–Nebraska pipeline and indicated the project was unlikely to have a significant impact on climate change. This seemed like a significant positive step […]

Resilient Sentiment Helps Market Grind Higher

The grind higher continued for stocks on Tuesday, with the S&P 500 just 40 basis points from recouping the year’s losses. This year’s trough was 6.1%, the steepest drawdown since late-2012, but it’s starting to seem a distant memory. Yet nothing has fundamentally changed to incite the recovery over the last couple of weeks. Then […]

Major Economic Themes for 2014

This time last year, the majority of financial commentators held a downbeat outlook for the global economy in 2013. The potential for instability was seemingly high, but in reality it turned out that the greatest shock was a lack of any major shocks. In the United States, the Federal Reserve reduced its monetary stimulus measures […]

Why Slow US Growth Isn’t Impacting Stocks—Yet

There is a reason why asset management firms don’t employ legions of economists to do their investing. Providing accurate economic forecasts is very useful, but financial markets generally don’t reflect the state of the world. US stock markets have rallied strongly over the last two years, while economic growth has been weak. Appetite for stocks […]

Primer on the US Federal Budget and Debt Ceiling Negotiations

The ongoing political wrangling in Congress is the source of bewilderment for many, with even major media outlets getting the federal budget  talks confused with the debt ceiling.Bloomberg is the latest victim, failing to distinguish the difference between the two issues. In essence, budget spending must be agreed by October 1st to avoid a government […]

MacroWatcher: Fed Tapering and Weekly Notes

The Federal Reserve’s quantitative easing program, announced in November 2008, has coincided with many positive developments. Equity markets have rallied strongly, the housing market has begun to recover, unemployment figures are improving and banks have recapitalized. This week the Fed holds a two-day meeting and may subsequently declare a tapering of QE; something eagerly anticipated […]